If Stock-Options Grants
Didn't Work, What Will?

By

Michael Casey Dow Jones Newswires

Updated Aug. 26, 2002 6:04 p.m. ET

Until recently, conventional Wall Street wisdom held that stock-option grants were the most effective compensation tool available for aligning top management's interests with those of shareholders. It took the painful bursting of the stock-market bubble and a slew of corporate scandals for investors to learn that this idea was way off the mark.

"Some of the things that people held as basic truths are being questioned, and rightfully so," says Raymond Miles, an expert in organizational behavior who is professor...